Of the total sales registered in the first nine months of 2020, 260 units were snapped up by foreigners. Buyers from China or Hong Kong accounted for 75% of foreign buyers.
Property buyers from Hong Kong, and other expats, have been flocking to Singapore since the end of the government’s “circuit breaker” lockdown in June – helping boost the city-state’s property market.
Among them was David, a top global investment fund executive, who was delighted that the rent for his six-bedroom home with lush backyard in Singapore costs two-thirds the price of his Hong Kong three-bedroom apartment, reported Financial Times (FT).
“The family loves the extra space,” said David, who declined to disclose his real name, as quoted by FT. “Now we are looking at buying.”
The move by Hong Kong property buyers to Singapore comes as the COVID-19 pandemic and the new national security law passed in June has reduced Hong Kong’s attractiveness, while making Singapore’s stability more prized.
Aside from a strong rule of law, the city state offers low taxes and one of the best connected airports in the world.
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“Singapore is in a very strong position despite the pandemic as far as real estate is concerned,” FT quoted PropNex Chief Executive Ismail Gafoor as saying.
He pointed to the city-state’s effective handling of the COVID-19 pandemic.
In fact, transactions of high-end properties have been on the uptrend even as the government imposed a lockdown in April, May and some part of June.
Data from the Urban Redevelopment Authority showed that there were 2,362 transactions within the core central region, where the highest-priced homes can be found, during the first nine months of the year, up from 1,962 over the same period last year.
This is despite the fact that the city state fell into its first ever recession since the global financial crisis due to the pandemic. Singapore’s economy contracted by 13.2% year-on-year in the second quarter of 2020 and by another 7% year-on-year by the third quarter.
Of the total sales registered in the first nine months of 2020, 260 units were snapped up by foreigners. While they were much lower compared to the 316 units sold over the same period in 2019, Gafoor said it was still “considerable” given the COVID-19 pandemic has made it extremely difficult to acquire a property for the most part of the year.
He noted buyers from China or Hong Kong accounted for 75% of foreign buyers.
Christine Li, Cushman and Wakefield’s Research Head for Singapore and South-east Asia, said overseas sales jumped following the end of the circuit breaker measures in June. Non-landed transactions, which usually involve condominiums or apartments, by foreigners fell in March, April and May.
The trend reversed in June, with sales soaring by over 200% from May, while July and August posted a 33% and 5% month-on-month increases.
Year-to-date, private residential prices in Singapore increased 1%, according to official data. Li said the core central luxury market saw prices drop 3.4%, but was partly offset by price growths in the city fringe and suburbs, where prices climbed 0.3% and 1.4%, respectively.
Knight Frank Associate Executive Sales Director Ella Sherman shared that she recently worked for a British expat couple, who were born and brought up in Hong Kong but have moved to Singapore.
“Sales have picked up as more Hong Kong businesses move to Singapore,” she said, noting that a lot of her customers are in private equity. “The influx of Hong Kongers may result in an uplift of asking prices.”